Relates to the incorporation of certain businesses for the purpose of practicing professional geology

Title of bill

An act to amend the business corporation law and the limited liability company law, in relation to the incorporation of certain businesses for the purpose of practicing professional geology; and to amend chapter 475 of the laws of 2014 amending the education law, the business corporation law and other laws relating to providing for the licensing of the profession of geology, in relation to the effectiveness thereof

Purpose

To allow business corporations consisting of geologists to become professional service corporations or design professional service corporations by amending their certificates of incorporation, to allow limited liability companies to become professional service limited liability companies by amending their articles of organization and to correct technical errors in chapter 475 of the laws of 2014 to provide for a 15 month grace period for geologists to be licensed by the State Education Department and to form professional service corporations, design professional service corporations or professional service limited liability companies.

Summary of provisions

Amends § 15O3 of the Business Corporation Law, § l105 of the Limited Liability Company Law, and section 28 of chapter 475 of the laws of 2014 to accomplish the foregoing .

Justification

Sections 1, 2 and 3 of this bill seek to facilitate the process by which business corporations can become professional service corporations and design professional service corporations section 4 seeks to facilitate the process by which limited liability companies can become professional service limited liability companies by amending their certificates of incorporation or articles of organization. Without this legislation, it would be necessary for these entities to dissolve their existing corporations or LLCs and form new professional corporations or LLCs. These proceedings are costly and time consuming and could possibly give rise to adverse tax consequences. A failure to enact this reform could also result in defaults of long term contracts that existing entities have with governmental agencies and others.

Section 4 corrects a technical defect in Chapter 475 of the laws of 2014 that would cause lapses in business for geologists. Specifically, § 7204 (b) and § 10 of the amended law require a geologist to be licensed and to be operating as a professional service corporation, design professional service corporation or professional service limited liability company as of the effective date of the law (November 21, 2016). It fails to take into consideration the fact that it may take several months for geologists to accomplish these tasks and that they would be unable to practice geology during this period of time.

Legislative history

New Bill

Fiscal implications

None to the State

Effective date

This act shall take effect immediately; provided, however, that sections one and two of this act shall take effect on the same date and in the same manner as chapter 475 of the laws of 2014 takes effect.